What will be the effect of new sanctions on the Russian oil industry?
Impact of sanctions will be felt, but not immediately. The sanctions could affect Russian production and extraction with a certain time lag, but more long-term one.
Do you think that planned EU restriction of access to Russian state-owned companies and banks to the European capital markets will not have effect?
Russian companies will be able to shift to other markets. This is partly happening. Another issue is that for them it will be very uncomfortable. They will find access to the Asian market, the Chinese one or these of Arab countries and the BRICS. Therefore, in this context, Russia will automatically go to the unfavorable conditions. True propaganda will treat it as another victory and a successful change of foreign policy to the East. That is, for Russia, it will be significant discomfort, but not enough.
If to speak theoretically, weather a limitation of energy export for Russian state-owned companies would be an effective measure?
In principle, on the European side, it would be great to implement at least partial restrictions on Russian oil exports to the EU, or to introduce quotas. It would instantly create a big problem, because reservoir facilities in Russia are not dimensionless, but reorientation of exports in the short term is simply impossible. In addition, Russia has no deep-water ports to accept supertankers (from 320 000 tons - Ed.). Therefore, to supply oil from the Black Sea and Baltic ports to the markets, which are further than Western Europe would be not economically viable. A conventional tanker of 100 thousand tons can be effective only in Western Europe.
The restriction on supply of oil service equipment, sooner or later, will still lead to the drop in production, isn’t it?
Fall will be, but not significant. Such measures may affect the development of new fields, in particular the Bazhenov Formation (group of unconventional fields in Western Siberia - Ed.), which is not possible to develop without Western technologies.
The most sensitive area is financial one. Here, for example, very sensitive for Russian economy will be the ban to use for Russia the SWIFT system.
Some European politicians fear that in response to the sanctions Russia may block the gas and even oil supply.
From my point of view, it is very highly probable scenario. Europeans to all the events that are now taking place in Ukraine, on the relations between the West and Russia, on the problems in the relationship in the energy sector throw a certain business model and see everything through the prism of business relations. Moreover, in fact, the coordinate system must be quite different. After all, Russia wages a hybrid war not only against Ukraine, but also against the EU. The difference is that against Europe, Russia has not applied yet the military component, but involved an energy one.
Let us remember that Putin said after a meeting in Normandy. That was June 6th. He said that if European companies will deliver a reverse gas to Ukraine, Russia cut supplies to Europe.
Then the European policymakers pretended to not notice it. In addition, to be more exact - just do not want to pay attention. Now Russia has confirmed its intentions. That is, while Russia has outlined its position.
Why the Europeans allow Russia to act in this way?
Russia felt slack in the European position. Firstly, there is no consolidated position, and a number of countries appears to be explicitly or implicitly against the sanctions. With that, not only Hungary and Finland, but also Italy, Germany and France. They are forced politically to do something, but economically they do not want these sanctions, and the business of these sanctions especially does not want to.
In Russia, they think this way: if to put a little bit more pressure on the Europeans , they simply abandon the sanctions regime, concluding that they are ineffective, they cause damage to the economy of the European Union in the first place. Therefore, the issues of oil and gas will again be withdrawn beyond the sanctions.
But if the gas will be cut for an extended period, in the long term it will result for the collapse of the Russian economy.
Russia today lives with the logic of war. Indeed, when there is no war - the business logic takes place. But Moscow now wages war, although it does not recognize that it is being conducted. In fact, they need to achieve now military purposes, and after that the business problems will be solved.
What Russia does aim to?
Strategic goal is to obtain a permit for the construction of the South Stream gas pipeline and the excluding of OPAL (continued the Nord Stream in Germany) from the Third Energy Package. If we take, for example, Germany, it is already on the verge of support such approaches.
That is, the upcoming talks on gas is a prelude before tightening the robinet?
Yes, and we can already see that the negotiations drag on. At first, they were announced at the end of August, but did not take place. Then at the beginning of September, and now reads the date of September 16th. Here it is clear who slacks the most. This is the Russian side that comes out of those positions, that the closer heating season is - the more prone to surrender on Gazprom’s terms will be the EU and Ukraine.
Russian calculation is to make the EU and Ukraine to operate in a temporary time trouble when there will be a need to make quick decisions. Like, if you do not make a decision, it will freeze your population and not because of Gazprom, but because of the position of Ukraine as the Russian company is "ready" to deliver gas. This is a calculation that the EU will work the business logic, and they will lose.
